How To Create A Robust And Legally Compliant Peer-to-Peer Payment App?

Updated on Jan 22nd, 2024

How To Create A Robust And Legally Compliant Peer-to-Peer Payment App?

With the growing digitization in the modern-day world, the payment apps became a popular aspect in the daily lives of the people. As the usage of smartphones increased among the people, the adoption of payment mobile apps increased worldwide. A report by Statista predicts that there will be around 1.3 billion payment app users by the year 2023! That’s huge as compared to 950 million users in 2019. Clearly, P2P payment apps are gaining momentum because of their robust features and user-friendly functionality. 

Nowadays, P2P payments apps are being used in a variety of services like bill payments, sending remittances, trip bookings, recharges, splitting bills, and so on. A robust peer-to-peer payment app helps the users to achieve the paperless transactions ultimately. Besides that, a P2P payment app also offers a fast, convenient, and secure method of the transaction to the users. Hence, owing to some great functionalities, P2P payment app development is becoming popular these days, and if you’re planning to develop one such app, then we’ve got you covered! 

In this article, we’ll discuss the essential steps to develop a robust and legally compliant peer-to-peer payment app. So, let’s start by covering the central aspect of the article – definition of P2P payment app.

What is a P2P Payment App?

P2P Payment App

A P2P payment app, also known as a peer-to-peer payment app lets users transfer a substantial amount to their friends, relatives, client, employee, or any other third-person. Through this powerful mobile app, a user can split the bill, pay for a service, transfer the money to another person’s account, and so on. The transactions processed through these payment apps are also secured as you can only transfer the amount to the person added to your mobile list. You can even use your credit/debit cards to transact through this app. 

The digital market today is filled with many such payment mobile apps like PayPal, ApplePay, GooglePay, Venmo, Square Cash, etc. All these apps have shown tremendous growth in the past few years, and the credit goes to their user-friendly features. But, as we know, the user-needs always change in today’s digitized market. Therefore, new payment mobile apps are always welcomed by the users, especially if they have robust functionalities. 

Different Types of  P2P Payment Apps

1. Banking Services

These types of payment mobile apps are offered by banks to simplify the transaction process for their clients. Using these types of payment apps, the user can deposit or withdraw directly from his bank account, even sitting in a remote area. In turn, the merchants that are being paid should have a proper POS system, and the mobile network operator should ensure the quality of service to the users.

2. Discrete Services

Next comes discrete services like PayPal, or Venmo, which allows users to transact using their banking cards. Usually, they enable the users to maintain an electronic wallet in case they don’t wish to transfer their money to their main account. You can even seamlessly enjoy almost all the vital banking features using these types of payment mobile apps. 

3. Mobile OS Systems

Mobile OS systems are a type of payment services that are in-built or can be enjoyed using a particular operating system. Common examples of such apps are GooglePay, ApplePay, AndroidPay, and so on. The users can send or receive money only through the users that are also active users of one such OS system. 

4. Social Platforms

It may be surprising for some of you, but the social media app that we generally use for chatting can also be used to send/receive money from your friends. You can send a specific amount to your friends directly from messenger leveraging these types of peer-to-peer payment apps. A typical example of this type is WhatsApp, which launched its P2P payment app in India, and it also became trendy. However, such a variety of P2P payment apps is only advisable when you’re developing a social media app.

Let’s now proceed to the next aspect and discuss the working of P2P payment apps. 

How P2P Payment Apps Works?

The working of P2P payment apps is quite simple. Any user wishing to use the P2P payment app has to register himself/herself on the app and needs to provide some basic information like email ID, mobile number, and a strong password. Besides that, you also need to link your bank account to the mobile app to seamlessly transact using the mobile app.

When sending or receiving money, the users need to add the recipient’s name and mobile number/account number, and the amount that needs to be transferred. Next, they will be directed to another page where they need to enter their password to finish the transaction process. This double security layer makes P2P payment apps more secure and popular among people. Also, the time of transaction is considerably less, as compared to the real bank transfer time. 

Reasons To Create A P2P Payment App?

If you’re still not convinced with the development of P2P payment apps, then we’ll give you reasons for that.

1. P2P payment apps are quickly becoming popular. Almost 69% of the users of Generation X and 51% of the baby boomers use payment apps, says Zelle, a payment mobile app company. A common reason for such a massive fan-base of these payment apps is convenience. The users find it very convenient to send money to their friends and other known people with a single tap or a few swipes.

2. The payment mobile app market is likely to upsurge in the coming years. The P2P payment apps market is quickly reaching new heights and is expected to grow more in the coming years, says the source.

3. The financial sector is seeing some powerful and incredible technological advancements and is soon expected to become fully digital. That’s why it is beneficial to invest in payment mobile apps to not only increase your brand value by providing seamless banking services to your users but also to stay ahead of your competitors.

So, these were the top three reasons for investing in a robust P2P payment app development. Let’s now quickly discuss the primary industries that can benefit from these payment apps.

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Which Industries Can Benefit from P2P Payment Apps?

It’s not only the finance industry that is benefiting from these P2P payment apps. Other industry verticals are also making huge profits leveraging peer-to-peer payment apps. Let’s have a look!

1. Retail and eCommerce Market

The retail and e-commerce market is fully leveraging the payment apps. Using P2P payment apps, you can get some fantastic discounts and bonuses. Apart from that, you can even enjoy some other benefits like quick payments, direct bank returns, and so on. A retail shop, to accept payments via a mobile app, should have a perfectly designed POS system.

2. Event-based Businesses

Grocery shops, food stores, and many other event-based firms have started to accept payments via mobile apps. Whether it is a supermarket, a movie theatre, or even a restaurant, you can seamlessly use your P2P payment app to pay for all the services. 

3. Transportation and Logistics Industry

The transportation and logistics industry is also becoming a part of this digital payment method. Many big transportation companies like Ola and Uber allow users to use a peer-to-peer payment app to pay for their services. Ola even introduced its payment app called Ola Money for its users. 

4. Telecommunication Companies

The latest trends in digital payments have even touched the telecommunication sector. The users can now seamlessly recharge their mobile phones, can pay their bills, or can also send money to other users under the same network. 

So, these were some of the industries that are benefiting from the latest digitization of the payment networks. Clearly, if you belong to any of those industries, then it’s the right opportunity for you to develop a peer-to-peer payment app best suited to your business needs. Let’s look at some critical steps for building a robust and legally compliant peer-to-peer payment app.

Vital Steps For Building Robust P2P Payment App

Steps For Building Robust P2P Payment App

For developing a powerful peer-to-peer payment app, you need to follow a perfect strategy. You need to conduct proper market research and should also identify the roadblocks that may hamper your development process. Here we have listed down some crucial points to be kept in mind while developing a mobile payment app.

Step 1. Choose A P2P Payment App Type

The first and the foremost step of developing a payment app is to figure out what type of P2P payment app do you wish to develop. For that, you need to have a clear understanding of the different kinds of P2P payment apps, along with their benefits and shortcomings. The most popular types, in general, are the banking service type, and the discrete type P2P payment app.

Step 2. Select A Suitable Development Platform

The next critical step in developing a peer-to-peer payment app is to select a suitable platform for your app development. You need to have a clear market infographic to choose the most suitable platform, viz. Android, or iOS. To make the work more comfortable, you can also go for cross-platform app development. That way, you could also enjoy more target users for your payment app. 

Step 3. Identify The Relevant Features

Having user-friendly features is the key to your mobile app success. So, your next big step should be to identify and include all the vital features to make your app a hit in the global market. Here we have tried to state some essential features to simplify your work.

1. User Registration

The registration process of your mobile app should be as convenient as possible. It should ask for relevant details like name, email, and a contact number to set their account on the mobile app. Long process and unnecessary details make the users annoyed. So keep that in mind. 

2. Send/Request Money

That’s the most essential and critical feature of your P2P payment app. The user should be able to send/request money using a mobile number/name as the primary ID. You can even provide the scan QR code option for facilitating fast payments. 

3. Unique ID/OTP

Many times, a user has to pay for services like food order, or online shopping. In such a scenario, OTP is an essential feature that one should include in his/her payment app. OTP or a one-time password is required for safe and secure transactions over your mobile app.

4. Secured Bank Transfer

Sometimes, the user wants to send money directly to his bank accounts and not to the electronic wallet of the mobile app. In such a scenario, the secured bank transfer option comes into play. It allows the user to directly deposit the particular amount into his/her bank account. However, to ensure a safe and secure transaction, you can add a password functionality before the user proceeds the bank transfer.

5. Billing/Invoicing

Your payment app should enable the users to scan the bills using their smartphone’s camera. Besides that, it should also generate invoices after every transaction made from your mobile app.

6. Transaction History

The transaction history option is critical when a user wishes to see all the transactions done via the mobile app for a particular period. It also makes the transaction process transparent and your mobile app efficient. 

7. Push Notifications

Push notifications are handy whenever you want to update your users about a new feature or change in your policies. You can even send crucial alerts like ongoing sales, or premium features to all your users using this robust feature.

8. Support

Support plays a crucial role in improving customer satisfaction. With this robust feature, you can solve all your customer’s queries and payment issues. With the latest advancements in the field of AI, you can even leverage the AI-driven chatbots to provide adequate support to your customers. 

9. Admin Panel

The admins of the mobile app need this feature. Through this powerful feature, the admins could seamlessly add or remove any feature of the payment app. It even lets them manage their mobile app even from a remote location.

Step 4. Consider All The Security Issues

Apart from providing the user-friendly features, you should also consider all the security issues to make your app more secure and liable for the users. Adding two-factor authentication, fingerprint scanner, face recognition, and other tools secure your app from cyber thefts. Apart from that, you can even send text messages to your user’s registered mobile numbers after each transaction is made from his mobile app. That way, he/she gets updated about all the operations carried out and can instantly report any unknown transaction.

Step 5. Build An Appealing UI/UX

Appealing UI/UX is critical for enhancing the customer experience. Users don’t like to spend much time on app thinking about how a particular thing works. So, your app’s design should be aesthetic, meaning it should be functional and attractive at the same time. The features should be clear enough to make the work more straightforward for the users.

Step 6. Conduct Proper Testing

After developing your app, you should conduct proper tests on it to know its performance. For that, you have two options – either hire an in-house testing team or to outsource a mobile app development team. An experienced mobile app development team has all the experts needed for the efficient development of your P2P payment mobile app. It even knows the solutions to all the issues that might come into the development process. 

Step 7. Ensure Regulation Compliance

Your app should meet the regulation standards of the market that you’re trying to target. For instance, if your target market is China, then you should get the approval from the FinTech Committee under the People’s Bank of China (PBOC). Similarly, if you’re planning to target Australia, then you’ll be needing legal approval from Innovation Hub by the Australian Securities and Investments Commission (ASIC). Targeting the USA is even a bit complex as it has over 50 states, and each state has its financial regulatory body. 

Challenges That You Will Face While Developing P2P Payment App

While developing a peer-to-peer payment mobile app, there are specific challenges that you need to deal with.

1. Security

Security is one of the significant concerns about payment apps. For quite some time, cybersecurity has become a considerable challenge for the financial industry and is still threatening the industry to its core. So, while developing a peer-to-peer payment app, you should pay great attention to security issues. 

2. Currency Conversions

At present, there are almost 160 different currencies in the world, and real-time conversions of all those currencies are not always available in every P2P payment app. So, you should consider this issue, too, while designing your app.

3. Comply With PCI DSS

All the P2P payment apps must comply with PCI DSS to secure their confidential banking data. Your app must meet the following criteria to comply with PCI DSS-

  1. Secured Data
  2. Strong Access Controls
  3. Continuous Network Testing
  4. Updated Security Policies
  5. Vulnerability Management System

4. Geo-Restrictions

As stated earlier in this article, every area has different financial restrictions, and it is almost impossible for an app to satisfy all the criteria of every region. Therefore, you should focus on a particular area while developing your payment app.

5. Dispute Settlements

Many times, a user sends a certain amount to his/her friend, but the recipient doesn’t receive the money. In such a scenario, you should have a proper committee that can solve such types of disputes and can credit the amount back to the user’s wallet/account.

Leveraging The Blockchain Technology To Make Your App Secure

As the usage of P2P payment apps is increasing, so is its security concern. P2P payment apps offer quick transactions to the user and are therefore used in cross-border transactions. Hence, implementing blockchain becomes a crucial aspect of securing payment apps. 

Usually, banks are responsible for securing sensitive banking data over cross-border transactions, but many a time they get leaked. So, blockchain helps to ensure data security by leveraging Rich Communication Services Protocol (RCS) over SMS. This particular service makes your mobile app more liable and secure. It provides a polling phonebook feature for transmitting multimedia files and discovering services. 

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Let’s Build A P2P Payment App With Matellio

So, that was all about developing a robust and legally compliant peer-to-peer payment app for your users. Besides all those points mentioned above, you also need to pay a lot of attention to other aspects such as accurately analyzing the market needs, marketing your product before it gets launch, finding a perfect mobile app development company, and so on. At Matellio, we have expert developers who not only help you build a useful mobile app but also provides you various ways of securing it. Apart from that, our certified QA Engineers help to find even the minimalistic error in your mobile app, making it a perfect one. So, in case you have doubts or wanted to get a free 30-minute consultation, then feel free to contact us at

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